Hryvnia Continues Downward Spiral Amid Interventions and Reduced Aid

The Ukrainian hryvnia continues to lose value against major currencies, reaching a psychological threshold in September. The average exchange rate for the US dollar approached 45 UAH, while that for the euro reached 52 UAH. To mitigate this effect, the National Bank has been actively intervening in the market, selling around $30-40 million daily on the over-the-counter market to purchase military equipment and meet the demand for foreign currency.

Since January 2026, the National Bank has spent over $35 billion to support the hryvnia's exchange rate. This includes nearly the same amount as was spent on direct interventions in the interbank market over the entire previous year. Trading volumes on the interbank market have consistently exceeded $300 million and approached $500 million, with a record high of $555 million recorded at the beginning of September.

The National Bank has sufficient resources to balance the foreign exchange market for now, but they are not bottomless. If international aid is reduced, there will be no funds left to continue large-scale interventions. Amid inflationary pressure from oil prices and Russian attacks on infrastructure, the National Bank appears more prepared for a further weakening of the hryvnia.

Government forecasts project the dollar exchange rate at 48.3 UAH by the end of 2027, with an average exchange rate of 47.1 UAH per dollar for the entire coming year. This represents a potential appreciation of approximately 3.7 UAH in Ukraine.